Gold headed for a third weekly decline after some investors reduced holdings of the metal as signs the U.S. economic recovery is gaining momentum spurred speculation that the Federal Reserve may pare stimulus.
Gold for immediate delivery traded at $1,560.05 an ounce at 9:18 a.m. in Singapore from $1,561.45 yesterday, when it dropped to a one-week low of $1,553.65. Holdings in the SPDR Gold Trust, the biggest exchange-traded product backed by bullion, shrank to 1,181.42 metric tons yesterday, the least since May 2010. Assets have declined 12.5 percent in 2013 as prospects for the recovery sent U.S. stocks to record highs.
Data yesterday showed U.S. jobless claims dropped more than forecast in the week to April 6. Several Fed officials said that the central bank should begin tapering its quantitative-easing program later this year and stop it by year end, according to the minutes of their March meeting, released this week.
“Gold’s rally is pared by better-than-expected U.S. jobless claims,” Howard Wen, an analyst at HSBC Securities (USA) Inc., wrote in a note. “Gold has been undermined by equity strength. We believe bullion may drift sideways near-term.”
Gold for June delivery declined 0.3 percent to $1,560 an ounce on the Comex in New York, set for a third weekly drop.
The Fed’s March meeting was held before a report last week that showed jobs growth was the slowest in nine months in March. Fed Chairman Ben S. Bernanke said earlier this week that U.S. economic conditions aren’t what he’d like them to be, sending prices to a one-week high on April 9.
Cash silver was little changed at $27.65 an ounce, up 1.2 percent this week for the first such gain in five weeks.
Spot platinum retreated 0.4 percent to $1,527 an ounce, down 0.7 percent this week in its fifth weekly decline, the longest slump since August.
Palladium lost 0.2 percent to $729.40 an ounce, set for a weekly increase.